Moreover, any hike in salaries would not be that much beneficial for employees as the increase would largely be eroded by the rising prices of commonly used items, experts say.

“The country is projected to witness an average increase in salary bills of around 12-13%,” global HR services firm HayGroup’s practice leader Mark Thompson said, adding “if inflation is taken into account, this still represents quite a reduction in the cost of labour in real terms compared to last year.”

The wholesale price-based inflation spurted to 11.05% for the week ended 7 June. Inflation has risen rapidly by 441 basis points since January 2008.

Manpower in its latest employment outlook survey had rated India as the most optimistic nation for hiring in the world.

Thompson added “high oil prices are here to stay, there will be a big impact on economic growth throughout the world at least until we can adjust to the new regime and adapt to using less oil-based products.”

Industry experts believe high crude oil prices and rising inflation levels would reduce growth rates in the country and therefore would lead to less hiring than would otherwise be the case.

“Rising crude oil prices will pose as a real challenge taking into account the fact that India is largely dependent on import of crude oil,” Malhan added.

The continuous rise in inflation has forced the banks to increase interest rates which analyst feel could further add to cost factor. Most of the banks have the prime lending rates pegged at around 13%.

After peaking at $139.89 per barrel level, oil prices at the New York Mercantile Exchange eased somewhat and were hovering around $134 a barrel.

The global economic slowdown had also a negative impact on hiring prospects. But experts term it as a lesser evil when compared with crude oil prices and inflation.

Though the US is a significant trading partner of India, much of the growth in the country comes from the home market, and this will continue to grow. Furthermore, during recession, the field of business process outsourcing, will be a more compelling for US companies to reduce their costs by exporting work to the sub continent.

Hence, concerns regarding US recession might not be all that bad for India, as economists hold the view that any slowdown in the US economy would reduce India’s growth by no more than 1%.